Tag: the short run fixed price analysis of the product market

Questions Related to the short run fixed price analysis of the product market

In the short run, land, capital, technology remain constant.

economics income determination unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. True

  2. False

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Correct Option: A

Inventory investment refers to investment in fixed capital assets. 

economics income determination unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. True

  2. False

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Correct Option: B

Autonomous consumption can be zero.

economics income determination unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. True

  2. False

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Correct Option: B

Autonomous consumption expenditure cannot be zero.

economics income determination unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. True

  2. False

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Correct Option: A

For open economy aggregate demand is equal to Consumption + Investment + Government expenditure.

economics concept of excess demand and deficient demand unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. True

  2. False

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Correct Option: B
Explanation:

An open economy is an economy in which there are economic activities between the domestic country with the other countries.

Hence, for an open economy, aggregate demand is equal to Consumption + Investment + Government expenditure + (X-M) where X is the income from Exports and M is the expenditure on imports

AD = C + I + G + (X-M)

Equilibrium price and quantity is determined by ___________.

economics concept of excess demand and deficient demand unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. Mid-point of demand curve

  2. Central planning agency

  3. Intersection of demand and supply curve

  4. Mutual discussion of trade and consumer associations

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Correct Option: C

Sweezy's model does not explain ______________.

economics income determination unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. price rigidity

  2. price determination

  3. output determination

  4. kinked demand determination

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Correct Option: B
Explanation:

The Sweezy's kinked demand curve model advocates the behavior of oligopolistic organizations when the price and output are determined. Therefore, Instead of laying emphasis on price-output determination, the model explains the behavior of oligopolistic organizations when price and output is determined.